Zomato Introduces ₹5 Pay On Delivery Fee Amid Rising Food Delivery Competition
Zomato has started charging customers an additional fee for cash-on-delivery orders, introducing a new “Pay on delivery fee” alongside existing charges. The move comes as food delivery competition intensifies with new players entering the market. Even small fees could generate significant revenue given Zomato’s large daily order volumes
Eternal-owned food delivery platform Zomato has introduced an additional charge for customers opting for cash-on-delivery payments, adding another fee to its existing consumer charges.
The new “Pay on delivery fee” is displayed separately in the bill summary when customers choose to pay in cash after receiving their orders. While the charge is typically Rs 5, some users have reported being charged higher amounts ranging from Rs 7 to Rs 20.
The new fee is separate from other charges such as Zomato’s platform fee, restaurant packaging charges and GST. Customers making digital payments are not required to pay this additional amount.
New fee comes amid intensifying food delivery rivalry
The introduction of the charge comes as India’s food delivery market faces increasing competition. New players are expanding their presence, with Rapido’s Ownly gaining momentum and Walmart-backed Flipkart testing its Eat In food delivery service.
Other startups, including Swish, have also secured fresh investments, increasing pressure on established platforms such as Zomato and Swiggy. Rival Swiggy has not introduced a similar cash-on-delivery fee so far.
For Zomato, the financial impact of such charges could be significant due to the platform’s large order volumes. The company handles an estimated 2.3-2.5 million food orders daily. If a Rs 5 fee were applied to every order, it could theoretically generate additional revenue of around Rs 1.15-1.25 crore per day.
Small charges emerge as major revenue streams
Although only a portion of orders are paid through cash on delivery, the move highlights how small customer fees can create substantial revenue opportunities at scale.
Food delivery platforms began introducing platform fees in 2023, with Zomato and Swiggy initially testing smaller charges. Zomato later increased its platform fee to Rs 14.99 per order from Rs 12.5, with GST charged separately.
With millions of daily transactions, even minor increases in customer charges can significantly boost annual revenue for food delivery companies.
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